Cross-badging may save on auto cos’ investment but as far as Indian automotive market is concerned this concept has not borne fruit for alliance partners. Following the footsteps of Renault and Nissan are Volkswagen and Skoda who are now restructuring their product strategy in India. The major reason behind failure of this concept in India is the minimal difference between appearance of models and their pricing. According to the new plan VW India is now working on offering products that vary majorly from its Czech unit Skoda. This would prevent clinching each other’s sales and it will also enhance the product portfolio of both the brands. Officials at Volkswagen India have also confirmed that they will not offer rebadged products in future. Besides distinguishing products on price front, brand pitch and visually, the company is also carefully working on lining launches at different times for not just Skoda but for other associated companies that come under VW like Audi, Lamborghini and Porsche. Gap between launches will prevent clinching each other’s sales.
Facelift versions of Volkswagen Vento and Skoda Rapid sedans are undergoing final modifications. The current versions of both the models share striking similarity; however it has been learnt that their tweaked avatar will vary substantially from each other. Traces of similarities will be seen between Rapid and Octavia, on the other hand Vento will sport various cosmetic changes.
In short rebadged engineering did not do any good to VW as it would have thought it would. Delving deep into the matter reveals that sales of Vento declined after launch of Rapid in India. Prior to Rapid’s launch VW was delivering around 3000 units of Vento on monthly basis, however the sales number fell to 2000 in FY 2013 and to 1600 in FY 2014. Vento’s sales have dropped further to 900 units between first quater of current fiscal. On the other hand Rapid roped in around 1600 to 1700 unit sales on monthly basis after its launch, but at present the sedan is only garnering around 750 unit sales per month.
However with implementation of the new strategy in line and roll out of upgraded Vento and Rapid in domestic market, things should get better for Volkswagen and Skoda. Vento facelift is expected to launch first followed by Rapid’s launch slated for a later date. Market condition has also improved in the last couple of months and with the festive season starting soon things should improve at Volkswagen’s end.
